Firm location and productivity in Spain

• Main Author: Adelheid Holl
• Format: Article
• Language: English
• Published: AECR 2013-01-01
• Series: Investigaciones Regionales - Journal of Regional Research
• Subjects: location; agglomeration; market potential; productivity
• Online Access: http://www.aecr.org/images/ImatgesArticles/2013/5/2_Holl.pdf

This paper presents an exploratory analysis of the relation between where a firm is located and its productivity. The analysis distinguishes two location characteristics measured at the municipality level: local agglomeration measured by population density and access to markets captured through market potential. The results show a significant positive relation between both local population density and market potential and firm-level productivity. The results further indicate that while productivity is higher in urban areas, the cross-sectional association between market potential and firm-level productivity appears higher outside urban areas.